An Entity Holding Both Financial Assets and Liabilities Is Allowed

Multiple Choice

An entity holding both financial assets and liabilities is allowed to offset and determine fair value on the net position as long as: I the entity holds a net short position
II the entity holds a net long position
III the entity has a documented risk management strategy
IV the entity manages the group of net financial assets and liabilities on a net exposure basis

A) I and II.
B) I and III.
C) II and IV.
D) III and IV.